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In this market, almost everything is up. How long can it last?



In June, the Federal Reserve leader Jerome Powell reported that the central bank would do what was necessary to ensure the continued expansion of the US economy. It has trumped concerns about a trade crisis and slowing economic growth.
US stock markets have hit record highs hoping the Fed will cut interest rates later this month. A cut would give companies access to cheaper loans. The S & P 500 is already up by almost 20% this year, the best start since 1998.

The outlook for the central bank stimulus has also increased bond prices, which are moving in contrast to returns. The US was at one point paying less than 2% interest on its 10-year government bonds.

The hope of lower prices also weighed on US dollars, because currencies tend to weaken when local interest rates fall. This in return contributed to the gold prices that have climbed around 1
1% this year. The dollar still holds gains in 2019.
Oil prices have plummeted from last year's steep decline, and climbed more than 21% this year, according to Refinitiv. The movement was partly caused by increased geopolitical tensions, which threatened the oil supply.

Nevertheless, there are many potential issues that can track the market momentum.

First, the US debt ceiling is back in focus after the Treasury said the government could run out of cash in September.

On the Fed front, investors worried about the pace of price fluctuations this year, and whether or not they really want the desired increase in economic growth.

Economists at the capital economy predict that US economic growth will decline sharply in the second half of 2019, and the Fed will cut interest rates by a total of three quarters of a percentage point. However, may take months for monetary policy measures to pass on to the economy.

  Christine Romans: Bull market not won by old age. But this can kill it

Another concern is that the US economy becomes less resilient to the trade war, as the industrial sector bears the bottom of the financial damage, according to James Knightley, chief international economist at ING.

Although the United States and China agreed on a tariff truce last month, President Donald Trump has warned that he could lift imports of Chinese imports. Uncertainty about trading is to weigh on the companies' investments, and it will not change unless the saliva is solved.

Meanwhile, China's economic growth has declined to its lowest level for almost three decades. State stimulation will help support the huge economy, but investors may be deprived of further weakness.

2. Pound watch: The UK gets a new prime minister this week and the stakes may not be higher.

The Conservative Party's selection of Theresa Mays successor could set the stage for Brexit and pound a fresh wave of volatility. The currency dropped to a two-year low below $ 1.24 last week.

Frontrunner Boris Johnson has said he would be willing to force Brexit on October 31, the last deadline for the UK to leave the EU if he is unable to negotiate a new deal with EU officials.

Leaving the EU without an agreement, it will unfold Britain for a recession, according to a report by the British Government's budget watchdog. The UK stock markets would fall 5%, while the pound would dump 10%. GDP will shrink by 2% by the end of 2020.

Johnson or opponent Jeremy Hunt is appointed as head of the party on Tuesday.

3. Boeing Earnings: Boeing ( BA ) is bracing for a catastrophic profit report.
The airplane has been hit hard by the grounding of its 737 Max rays. Southwest ( LUV ) American Airlines ( AAL ) and United Airlines UAL ) has all recently extended cancellations of 737 Max aircraft for several months.

It will probably make earnings for Boeing, which will report its second quarterly results before the opening clock on Wednesday. Analysts assume a decline in sales of more than 16% from the previous year and almost 50% in earnings per share.

Last week, the company said it would record nearly $ 5 billion in taxes in the second quarter, citing potential concessions to customers for disturbances and delays in delays.

The question is how much worse it will get. The company suspended its earnings guidance in April after having reported a decline in earnings of 21% in the first quarter. Boeing also plans to buy back more of its own stock on hold until 737 Max is back in the air.

Boeing's best competitor, Europe's Airbus, has delivered 150 aircraft to the airlines than the US planner during the first half. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ] Amazon ( AMZN ) a week after they were grilled on Capitol Hill.

Facebook reports revenue for the second quarter Wednesday. Analysts expect quarterly sales growth to reach 23%. But there will be considerable focus on what Facebook has to say about increasing control from regulators.

The company has been under the microscope since the announcement of Libra, a cryptocurrency. The Federal Trade Commission has also reported approved a $ 5 billion settlement with the company related to a privacy practices investigation.

Google parent The alphabet comes with income on Thursday. Analysts project quarterly revenue of $ 38.2 billion. This would be an increase of 17% from the previous year, a growth on a par with that in the first quarter, but still lower than the growth through 2018, as revenues increased by over 20% in each quarter.

Google shares were missing out on a rally enjoyed by the other FAANG shares. The company's shares are increasing almost 10% this year.

Facebook stock, meanwhile, has jumped more than 50%. Stocks in Microsoft and Amazon have increased more than 30%.

Amazon also reports results Thursday. Investors will be interested in whether the company's push for free one-day shipping has lifted the sale. They will also be aware of the performance of their highest profit division: Amazon Web Services.

5. Coming next week:

Monday Whirlpool


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